The paradox of the death spiral is that many pilots actually believe
they are stabilizing their plane when they are actually tilting it.

What is "The Death Spiral"?
====================
The death spiral for startups is like the condition that occurs to pilots when they fly into "weather." The "weather" right now is the massive confusion and uncertainty of the financial and consumer markets.

We can now operate past 2012 even if we never make any advertising revenue, and truth be told, building advertising-based companies is my specialty (the last two, Silicon Alley Reporter and Weblogs, Inc. each broke 10m a year revenue between their third and fourth years).

Perhaps we're being too conservative, but I've rarely heard of companies that went out of business because they made cuts too early, and I've heard of many who have reported the opposite.

Take notes, Taurus. That's the new story. Stick to it. Be strong. Profits are so 2013. Did you have a layoff? No? Too late. Now let's go out there and kill it again! (Photo of Jason and Toro from 2005 for Wired by Emily Shur)

Developers/Senior Developers (Santa Monica)

Reply to: job-894125901@craigslist.org [?]
Date: 2008-10-26, 10:07AM PDT

Do you know that you're amongst the very best, but can't find a company that appreciates you or gives you the opportunity you deserve?

Mahalo.com is a human-powered search engine. It is one of the hottest startups on the planet right now. We're well-funded by the same people that backed Google, Yahoo and YouTube (Sequoia), a well as Newscorp, Mark Cuban, Elon Musk (Paypal) and CBS. Our human-curated results are the very best starting page for any topic you can think of, blowing away machine-only search engines. And our growth curve has been phenomenal: this coming year ought to be downright amazing.

We're looking for top-notch Developers and Senior Developers to get us to the next level.

Skills we're looking for include the following (you should have a subset of these, all are not required):
* Python, PHP
* C/C++, Java
* MySQL
* Familiarity with MediaWiki
* memcache, squid
* Strong command of PHP5
* Familiar with general Internet technologies including HTML, XML, Javascript, HTTP, CSS, cookies, etc.
* Knowledge and experience in Apache, MySQL, Linux

Bonus:
* Hadoop / Hbase
* Lucene
* Nutch
* Spread

You are a HANDS ON implementor, a get-it-done kind of developer. The right person is a self starter with the "general get it factor". You work well with a team of like-minded engineers, and have a genuine desire for excellence.

We work with cutting-edge technologies. You will learn more here in a month than most companies will teach in a year.

Although we work hard, we offer a laid-back environment, competitive salary, benefits and stock options. This is a potentially life-changing opportunity — the kind that is usually only available in Silicon Valley, and is extremely rare in Southern California. If you're excellent, we invite you to come join us.

Please send a RESUME.

Location: Santa Monica
Compensation: Commensurate with experience + Options
Principals only. Recruiters, please don't contact this job poster.
Please, no phone calls about this job!
Please do not contact job poster about other services, products or commercial interests.
PostingID: 894125901

From: jason@calacanis.com
Subject: [Jason] How to handle layoffs
Date: October 22, 2008 6:10:18 PM PDT

It's interesting to watch the negativity and obnoxiousness of some bloggers and anonymous commenters while these layoffs have been going on. When things go bad you can really tell what people are made of.

• Don't lay people off one at a time, do it as a group. Don't spread layoffs over multiple rounds.
• Cutting salaries over headcount is generally not a good idea.
• Give severance even though you don't have to. Be as generous as you can.
• After the layoffs, get folks ready to kill it again.

Calacanis shovels page after page of boring details about P&L and office expenses. You know what word's not in there? "Sad." Boy Wonder's not going to spell it out, so I will: If layoffs don't get you as excited as that time you jumped out of an airplane, then realized too late what a lousy job you'd done of packing your own parachute and you were going to die now — heh, layoffs! Love 'em or go back to grad school.

(Photo by nikan_gr)

I wonder if he and Michael Arrington taught "how to fire half your staff" at TechCrunch 50 this year?

Silicon Alley Insider reports that a third of Mahalo's full-time staff was laid off; Calacanis, in a blog post — wait, we thought he stopped blogging — muddles the issue by saying Mahalo has 70 full-time and freelance staff. A former Mahalo insider, however, says the real full-time staff has dropped by roughly half, from 60 this summer to 30 before the layoffs. The Brooklyn-raised CEO is ever the artful dodger.

Awesome.

But in the section, "How to bond with a journalist," he suggests that "you can cut to the front of the line by spending just 30 minutes researching the journalist you're pitching." We're not sure what's creepier: (A) that Calacanis emailed the piece directly to me and very special contributor Paul Boutin, nagging us to post it, or (B) that his suggestions describe the duties of the minion he employs to monitor us.

I've gotten so obsessive about this that my liaison Tyler, whom anyone who's met with me in the last year knows, keeps tabs on our journalist and blogger contacts. He not only reads their work, he always stays in contact with them. This means we are in constant research and dialogue with the folks who are covering us. This means when we meet about a story we know as much about the journalist as they know about us—sometimes more! Tyler will hand me a stack of stories and background information on the people we're meeting with on the flight to another country so I can play catch up.

I have officially been scared into never oversharing again, lest some flack or wantrepreneur watch and wait until I'm in a vulnerable emotional state to better prey on me.

Probably because it's the first animal listed in most dictionaries, implying there will be many more products to similarly anthropomorphize. Assuming the funds from the "mega-Series-A round" the company is looking to close doesn't run out first. According to the prehensile news nose of Kara Swisher, the valuation will be "larger than is typical at this stage in the game." Mahalo and Wikia leave me unconvinced that creating new tools to get help from friends on Web queries will ever make a dent in Google's search market share. If I wanted to ask my friends — even strangers — a question, I've got all sorts of social networks I rarely use like Twitter and Facebook. Email and IM work better, anyway. It's called the Lazyweb for a reason. Why make it harder? (Photo by MontageMan)

"Who's your daddy and what does he do?"

It seems Google is not satisfied with owning over 70% of search—now they want to own the first couple of pages in their search results. So, if you're digg.com, About.com, NYTimes.com, and Wikipedia you're faced with not only being traffic-dependant on Google, you're now competing with them for the traffic within their search result.

This feels exactly like what Microsoft did to its application vendors. Microsoft convinced folks to build WordStar, WordPerfect, Lotus 1-2-3, and Quattro Pro for their operating system. They grew that business together until the point that Microsoft had massive market-share in operating systems.

Then Microsoft pulled the rug out from under the 3rd party application vendors. The streets were littered with dead software companies, Microsoft faced massive lawsuits, and the industry became stagnant until the Internet shook things up again two decades later.

Frankly, it's insulting to say you're not in the content business and then launch Knol and compete with content companies for their authors, users, and placement in the rankings that you control.

For Google's own good they should not try to take over their own search results. If Google results start showing 20-30% Knol pages and YouTube videos then that is going to drive users away from Google in search of more diversity.

As a hedge we're partnering with Google. We've put 30 of our How To articles into Knol, and we're very big partners with YouTube on our Mahalo Daily show. If you can't beat them join them. If Google is destined to be the new Microsoft then it's best to get into the tent early.

I've become addicted to playing poker because your constantly faced with confusion, and winning is trying to make sense out of nonsense.

Thankfully, studies have shown recovery is much easier when you have a supportive spouse. No scientific word on the effect of pets, but I can't imagine having two lovely bulldogs hurts. Just remember, Jason, one day at a time. (Photo by wmmarc)

Investing in companies, even at late stages, is a relative bargain because of the strong euro, and once a company goes public, the returns are doubled again because companies trade at a much higher price-to-earnings ratio on average than the do in Europe. However, after telling a story about entrepreneurs turning land in southwestern France being managed by the government into a newly productive wine region from which guests were tippling the bounty, Wellington's Eric Archambeau explained that the new office was going to focus on business development. "Who needs another VC in Silicon Valley?" he quipped.

One of the companies in which Wellington has invested is Seesmic, the online-video tool founded by the crushingly gregarious Loic le Meur, who bent our ear over enabling his company's technology in our comments. If it means TechCrunch's Michael Arrington might drop by to share some of his deep thoughts, then I might just be able to make Le Meur's case with our publisher.

Sitting through the Search SIG panel last night I kept worrying the speakers were going to pants Wikia Search’s Jeremie Miller Nick Sullivan. Such a delicate little man, yet so much holier than thou. At one point Jason Calacanis said outright that Wikia Search would fail and that it's goal was simply to make Jimmy Wales rich. I think I actually heard Jeremie's Nick's heart break in response.

The problem with Jeremie Miller Nick Sullivan (and by association Wikia Search) is that he believes by using open source he can do no evil. He was adamant that since Google makes decisions about what you see in your search results the world needs an open source search site. For freedom! But even Wikia Search has to create a system to rank results. There are many that bemoan the politics of the Wikipedia system, so why should Wiki Search be any better?

Jeremie would like you to think that Wiki Search is a tool created by the common man, but even he knows the truth. He let slip that 99.5% of his users never add any content to the site. I'm not sure how one could call a site built by the top 1/2 of 1% of all users 'open'. I think even the Bush tax cuts were more inclusive than that.

I was hoping to report on some wild accusation made by Jason Calacanis, but he turned out to be the most level-headed one on the panel. Even FriendFeed's cofounder and CEO Bret Taylor admitted to his site's deficiencies. But I will take the smarmy look of Jeremie Miller with me to the grave. Although if Jason has it right, at least I won't have to look at his site for much longer.

Update: Nick Sullivan writes to point out that he was the lamb despatched to the slaughter, filling in for Wikia's Jeremie Miller. Sullivan disputes his delicacy — after all, he did gamely step in front of the Calacanis bus.

Vallewag: What would you think of Jon Miller going to Yahoo?

Calacanis:

Jon Miller would be amazing for Yahoo because he is extremely good at building display advertising businesses and buying young startups. Remember, when they let him go he was coming off back to back 40%+ gain quarters in advertising revenue—second only to Google (and well ahead of Yahoo). His biggest strength at AOL—in my mind—was buying promising startups and giving them tons of support, no red tape, and breathing room. Yahoo needs new blood and a focus on display advertising, with Ross [Levinsohn, former CEO of Fox Interactive and Miller's partner at VC firm Velocity Interactive] at his side you would have a very potent operator and M&A team.

Yahoo's best strategy right now is probably to build display advertising while buying and growing promising startups. Yahoo needs growth, Jon and Ross are growth guys (i.e. MySpace, Advertising.com, Weblogs, Inc, etc). As a bonus you have hundreds of VP/SVP/EVP level executives out there who are loyal to Jon and Ross, so you might see a talent influx with them at the helm, and talent wins.

Valleywag: You think he'd take the job?

Calacanis:

• Pro: It is the most challenging job in the space second to AOL
• Pro: Having reinvented AOL this would be cake walk/much more pleasant.
• Push: It would require a move from East to West coast—which is both a + and -
• Pro: It would be a great way to show the folks at [Time Warner] who's the man

I'd say if he gets the call he would most likely take it... big opps like this come along once every 5-10 years.

I need more dinners out with Jason Calacanis, rarely do you see a successful entrepreneur with such balance in all aspects of his life.

Just idle speculation, granted. Calacanis may have proper balance in his life, but the workaholism he demands of employees is another matter. We know for a fact that Sean Percival, an early Mahalo employee, has moved over to startup DocStoc.

• Online sales and operations account manager, Google
• Content acquisition intern, IODA
• Customer support specialist, Fox Interactive, MySpace division
• Windows support professional, Microsoft
• Part-time guide, Mahalo

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(Photo of Arrington and Scoble by Brian Caldwell)

Even at rates more typical of outsourced workers in Asia, applicants are expected to be versed in "online research, journalism, and wiki markup language." While costs have gone up in the last five years, the Calacanis payscale hasn't significantly — new Weblogs Inc. bloggers typically made $500 for 125 posts a month back in 2005. But with unemployment on the rise, expect there to be plenty of interest. And hey, at least Mahalo's paying, which is more than Jimmy Wales can say for the contributors to Wikipedia.

When we wrote up our list of tech's 10 worst entry-level jobs, we figured Cashmore will pay his assistant around $55,000 per year. But since, we've learned that number is well high of the mark. Readers figured Cashmore will pay $51,000 per year. We've heard Mahalo pays guides between $30,000 and $35,000 per year, but commenters on our original post told us we got it wrong. Wrote Richeem:

Figuring Mahalo's current pricing for the average page, wait time for acceptance, and any other factors a "good" ptg would be lucky to make $50/day. I highly doubt they are accepting more than 5 pages per day per ptg! Specially given the fact they have 120+ pages pending review.

Readers later guessed $32,000 per year.

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In our last matchup, working as a Microsoft Windows support professional handily trounced the Yahoo finance internship in our last matchup, 59 percent to 41 percent.

Boo fucking hoo. I clicked through about 4 of those and if they are representative, then getting paid 60-70K right out of college at an "entry" level job is nothing to complain about, regardless of the "tough" working conditions (ceiling too low? CSR work? no windows? cubicle? oh the torture!!). I spent half my life to get a Ph.D. and will barely be making that as an asst professor at a major research university.

By the way, if you actually work one of these jobs, create an anonymous Gmail account — or Yahoo Mail, if it's the Google job — and tell us the real number.

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(Photo by eston)

In the spirit of full disclosure, I should note that I wouldn't have been able to get any of these jobs out of college. I didn't finish with a 3.8, do a year of service in Nicaragua or file any patents during my sophomore year. But the worst part of this list is the fact that the people taking these jobs did. To paraphrase Dan Lyons, there's something distinctly evil about the way Google and the other companies listed below hoard the world's best and brightest and put them to work on creating more efficient text ads or, worse, tasking them with taking phone calls from angry customers.

Follow the link for each job to see a picture of their locations, a list of key responsibilities, first hand accounts of why each job is so bad and how much they pay.

• Tech's ten worst entry-level jobs
• Online sales and operations account manager, Google
• Support engineer, Washington-Seattle, Amazon.com
• Content Acquisition Intern, IODA
• Customer support specialist, Fox Interactive, MySpace division
• Database administrator (temporary), Google, contracted through WorkforceLogic
• Support professional, product: Windows, Microsoft
• Executive admin to Mashable CEO Pete Cashmore
• Analyst, user operations, Facebook
• Operations finance, analyst intern, Yahoo
• Part-time guide, Mahalo

(Top photo by star5112)

1. Mozilla
2. Facebook
3. Mahalo
4. DoubleClick
5. Yahoo
6. Microsoft
7. Google
8. LinkedIn
9. Jajah
10. Adobe

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• Tech's 10 worst workspaces
• Yahoo
• Mozilla
• Mahalo
• Google
• Microsoft
• LinkedIn
• Jajah
• Facebook
• DoubleClick
• Adobe

I'm also a fan of her character Addy May — the refreshingly blunt Southern gal dishes advice, and shows what a trained performer with improvisational moxie and deft comedy timing can do. Plus she's cute, she loves L.A., she's a South By Southwest veteran and I'll bet she has a soft spot for bulldogs. I hear if she doesn't get the gig, Jason Calacanis can expect a late night visit from the Ninja. Don't say I didn't warn him. (Photo by James Smith)